What does reverse stock split mean?

Definitions for reverse stock split

Here are all the possible meanings and translations of the word reverse stock split.

Princeton's WordNet

  1. reverse split, reverse stock split, split down(noun)

    a decrease in the number of outstanding shares of a corporation without changing the shareholders' equity


  1. Reverse stock split

    On a stock exchange, a reverse stock split or reverse split is a process by a company of issuing to each shareholder in that company a smaller number of new shares in proportion to that shareholder's original shares that are subsequently canceled. A reverse stock split is also called a stock merge. The reduction in the number of issued shares is accompanied by a proportional increase in the share price. New shares are typically issued in a simple ratio, e.g. 1 new share for 2 old shares, 3 for 4, etc. A reverse split is the opposite of a stock split. Typically, the stock will temporarily add a "D" to the end of its ticker during a reverse stock split. Sometimes a company may concurrently change its name. This is known as a name change and consolidation. There is a stigma attached to doing a reverse stock split, so it is not initiated without very good reason and may take a shareholder or board meeting for consent. Many institutional investors and mutual funds, for example, have rules against purchasing a stock whose price is below some minimum, perhaps US$5. In an extreme case, a company whose share price has dropped so low that it is in danger of being delisted from its stock exchange, might use a reverse stock split to increase its share price. For these reasons, a reverse stock split is often an indication that a company is in financial trouble.


  1. Chaldean Numerology

    The numerical value of reverse stock split in Chaldean Numerology is: 3

  2. Pythagorean Numerology

    The numerical value of reverse stock split in Pythagorean Numerology is: 2

Images & Illustrations of reverse stock split

  1. reverse stock split


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"reverse stock split." Definitions.net. STANDS4 LLC, 2018. Web. 24 Feb. 2018. <https://www.definitions.net/definition/reverse stock split>.

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